Tucked away inside the walls in the lower part of town – bear right as you enter the main gate – is this pleasant option with an excellent restaurant. Bought by Emmy-winning Brazilian telenovela writer Aguinaldo Silva, it's had a glitzy makeover (think fluffy rugs, oyster decor and rooms named after Portuguese queens), which might not appeal to all.
Most rooms have balconies looking at the walls: this can be your venue for breakfast if you choose. It has opened excellent new budget sleeps across the street at Hostel Vila d'Óbidos.